Who funds SA fossil fuels?

South Africa has an extremely fossil-fuel intensive economy. According to research commissioned by our partners 350.org (download full report), in 2014, South Africa produced approximately 260 million tons of coal, of which 69.6 million tonnes, nearly 27%, was exported. South Africa contributes 6% of total global coal exports and is the world’s sixth largest coal-exporting nation. In 2013, 93% of South Africa’s energy production still came from coal.

Subsidies to fossil fuels: up to R30 billion a year

All South Africans are essentially forced by government policy to fund fossil fuels, through the extensive state subsidies given to both state-owned enterprises like Eskom, and supposed private companies like Sasol. In a 2018 publication, Sustaining Carbon Lock-In: Fossil Fuel Subsidies in South Africa, Jesse Burton, Tawney Lott And Britta Rennkamp conclude that:

Our analysis has shown that fossil fuel production has been and continues to be
supported in various ways in South Africa. Since 2008, direct transfers have ranged
between USD 454 million and USD 2.09 billion per year, whereas quantified
revenues foregone have been between USD 2.45 million and USD 336 million.
This increases considerably when we include the price support received by Sasol
via the regulated fuel price. Beyond this, substantial unquantifiable subsidies exist
but require further research to quantify.

To put that $2.09 billion figure in context, it amounts to around 2.34% of total government spending for 2015/2016.

Top lenders to big coal in South Africa 2011–2016

FirstRand

Standard Bank

Investec

Barclays (parent company of ABSA Bank)

Old Mutual (parent company of Nedbank)

Industrial Development Corporation

Top five SA fossil fuel industry recipients of credit 2011–2016

Eskom

Dreamvision Investments (Exxaro and Cennergi)

Glencore Xtrata

Sasol

Anglo American

The biggest investors in the SA fossil fuels industry 2011–2016

Public Investment Corporation

Industrial Development Corporation

Coronation Fund Managers

Sanlam

Old Mutual

Investec

There remains an enormous gaps between the declared public stands of these companies on climate change – many of which purport to care about it, and their actual actions, which are mostly “business as usual”.